Sarah Williams loves the NHS, being a physiotherapist and having a job that involves meeting so many people. But next Wednesday, instead of treating patients at Russells Hall hospital in Dudley, West Midlands, she will be involved in the first industrial dispute in the health service since the ambulance crews dispute in 1988.

"The government's pension proposals are unfair, unreasonable and unnecessary," said the 29-year-old. "The coalition sees this as an easy money grab, to cut the deficit by taking money out of the back pockets of public sector workers.

"That's the biggest frustration – the extra money they want us to pay wouldn't even go into my pension but straight to the Treasury. That's why I'm striking: the case has not been made as to why these changes are necessary."

She earns £30,460 a year for her 37.5-hour week. She sees up to 21 patients daily, either individually or in small groups, all of whom receive hands-on treatment in 30 or 45-minute slots.

They include people with bad backs, sports injuries, work-related problems, arthritic knees and painful ankle ligaments. It is, she says, physically demanding as well as intellectually draining work.

Williams pays £165 a month in pension contributions. But under the government's plan to increase contributions by 3.2 percentage points she would have to pay an extra £68.50, or £822 gross a year, and work until she is 68. Over her working life that would come to £29,600 – almost a year's salary.

Unions deny there is any need to change the pension scheme, given it was renegotiated in 2008. That overhaul should have meant it did not need to be re-examined for a generation, they say.

"It's unfair to ask staff to pay more now when we accepted in 2008 the principle that employees will pay more to make the scheme viable and sustainable in the long-term," said Christina McAnea, head of health at Unison, which represents about 450,000 NHS employees, including 250,000 nurses, midwives and healthcare assistants.

That revamp in 2008 took account of increasing longevity, one of the arguments the coalition uses to justify further changes now, said Rachael Maskell, McAnea's counterpart at Unite, whose 100,000 members in the NHS include paramedics, mental health nurses and some doctors.

"Currently the NHS scheme every year brings in £2bn more in contributions than goes out in payments. Under the deal agreed in 2008, in which it was agreed that people who earned more should pay more into the scheme under the 'cap and share' model we adopted, it will continue to make a profit for another 21 years before we get to a neutral position. So there's no reason at all to re-examine it."

The Unite general secretary Len McCluskey claimed the pensions shake-up is the government's attempt to "force the less well-off to pay for the sins of the elite" – bankers.

Claims of "gold-plated public sector pensions" ring hollow in the NHS where the average pension is £7,000, even when the retirement pots of high-earners such as doctors are factored in. For Unison members in healthcare it is £4,000 but just £3,500 for women, said McAnea.

Unions are also angry over plans to replace a final salary scheme with a less generous career average one, a move they say would penalise the women who make up 70% of the NHS workforce, many of whom take breaks to have children.

Linking a NHS pension to the longer official retirement ages proposed by ministers would also hit who do physical tasks such as lifting patients.

Many physios get pain in their hands after many years of treating patients, said Phil Gray, chief executive of the Chartered Society of Physiotherapists (CSP). "As well as this being a very unfair deal that betrays promises already made, it's also inconceivable to expect physios to keep delivering a full day's hands-on practice until they are 68. That prospect fills our members with horror."

Unite's Maskell added: "Can you imagine a 68-year-old paramedic lifting a man in his 40s weighing 15 stone down stairs into an ambulance? That's unrealistic."

Dean Royles, director of NHS Employers, which represents most of the service's major organisations, notably hospitals, says he understands the anxiety about pensions but condemns next Wednesday's action.

He was it was both "premature", as talks were officially still going on, and likely to "ruin" and "poison" the NHS's positive employment relations climate. The action could set striker against non-striker and ultimately affect patient care, he warned. "Strike action should be the final thing we do".

Andrew Lansley, the health secretary, is "personally committed to reaching an agreement that is both fair to staff and fair to taxpayers". But he is also adamant that "without change, the current pension scheme is unsustainable" and that "people will need to work a bit longer and need to pay a bit more."

Even after the planned changes, NHS pensions would still offer better value than any private pension, he added.

But there are fears that the scheme, currently a model of good practice, could be seriously weakened if staff pull out. McAnea said: "Ministers say there will only be a 1% optout but surveys show it could be as much as30%, and we think it will be at least 10%, which would affect the viability of the scheme."

Many of the NHS's 1.5m-strong workforce earns below £20,000. "With NHS pay frozen until 2013, inflation rising and many families struggling, many are already thinking 'what could I do with another 7% or 8% of my salary'?"

Pensions and health workers

Much of the resentment surrounding the debate over public-sector pensions goes back to reforms agreed in 2005 between unions and Labour trade and industry minister Alan Johnson. Under the deal, which took effect in 2008, government contributions were capped and a sliding scale of employee contributions was established for staff earning higher salaries. The retirement age increased for younger employees.

The complex NHS scheme, like many in the public sector, was simplified, making it easier to run. No longer did staff earn a retirement income worth half their final salary with a bonus bung to make it worth two thirds. Instead the streamlined scheme paid a nurse on £30,000 a retirement income of £20,000.

Under the cap, an increase in costs would be shared between employer and employee for the first time. This answered the criticism that public service pensions were an open-ended liability.

These hard-fought compromises were expected to last a generation.

But the employer contribution cap of 14% and staff addition of 6% falls well short of the 30% to 35% needed to provide a final salary pension. Life expectancy has also soared, wrecking the calculations of a decade earlier. Ministers argue the scheme will need billions of pounds in top ups from the Treasury before the NHS reaches 2020 unless higher earners contribute up to 8.5%.

As importantly from the government's point of view, private sector employers will find it increasingly difficult to bid for NHS work when the incumbent supplier can offer a generous subsidised retirement scheme. Reducing benefits and raising the retirement age at a faster pace than Johnson envisaged allows the private sector a fighting chance. Phillip Inman